Institutionalism and Fact-Finding in International Disputes

Swinehart, Matthew W.

doi:10.2139/ssrn.3318935

Cited by 1 publication

(1 citation statement)

References 12 publications

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“…Its power in affecting human decision-making is well recognised in the literature of psychology. 86 Anchoringrequesting an inflated damages awardis effective in investment arbitration, 87 particularly when arbitrators lack objective means to determine compensation and for this reason use the investor's big initial claim as a baseline.…”

Section: Procedural Reform Optionsmentioning

confidence: 99%

Assessment of Damages and Compensation in the Context of ISDS Reform Proposals

Фоменко

2023

jil

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This article discusses the possible reforms in the assessment of damages and compensation in international investment arbitration. The article highlights the challenges of the valuation leading to the need for reforms, such as the inflation of awards issued in investment arbitration cases, the major gap between the damages claimed and damages awarded, and the difficulties posed by the large damages awards for the developing states. Other reasons for reforms include arbitral tribunals’ inconsistency in the valuation, the incorrectness of awards and potential conflicts of interests between arbitrators and damages experts. The author further discusses whether the issues of damages and compensation in investor- state disputes fall within the mandate of the UNCITRAL Working Group III, which is argued to be limited to solely procedural issues. The author concludes that the reforms could and should be developed by the Working Group III. The assessment of damages and compensation in investor-state disputes requires a comprehensive reform process based on procedural solutions as well as substantive suggestions, which the Working Group III can devise. Based on the law and economics theories, the author analyzes the appropriate approach of tackling the quantum issues, concluding that the reforms should be implemented through soft law instruments. The article dwells on viable procedural reforms on the quantification of damages and compensation in investment arbitration. The analysis focuses on the reforms prospecting to address the damages experts’ possible conflict of interest, the divergence in the parties’ experts damages amounts and the anchoring effect of the claimants’ requested amounts on arbitrators, as well as on the option of conducting early damages conferences, drawing on the insights from behavioral economics. Lastly, the article discusses substantive reforms options for the valuation that help promote the consistency and correctness of awards. The author considers the options of clarifying the use of the discounted cash flow method and setting standards that require damages to reflect a balance between the competing interests, providing guidance on the investor’s contributory fault, capping compensation to the actually invested amount and the assessment of contextual factors relevant for the calculation of damages.

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Section: Procedural Reform Optionsmentioning

confidence: 99%

Assessment of Damages and Compensation in the Context of ISDS Reform Proposals

Фоменко

2023

jil

View full text Add to dashboard Cite

show abstract

Institutionalism and Fact-Finding in International Disputes

Cited by 1 publication

References 12 publications

Assessment of Damages and Compensation in the Context of ISDS Reform Proposals

Assessment of Damages and Compensation in the Context of ISDS Reform Proposals

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